(Present-value comparison) Much to your surprise, you were selected to appear on the TV show "The Price is Right." As a result of your prowess in identifying how many rolls of toilet paper a typical American family keeps on hand, you win the opportunity to choose one of the following: $1,500 today, $5,000 in 12 years, or $28,000 in 29 years. Assuming that you can earn 6 percent on your money, which should you choose? If you are offered $5,000 in 12 years and you can earn 6 percent on your Money, what is the present value of $5,000?(Round to the nearest cent.) 1:36 GM

(Present-value comparison) Much to your surprise, you were selected to appear on the TV show "The Price is Right." As a result of your prowess in identifying how many rolls of toilet paper a typical American family keeps on hand, you win the opportunity to choose one of the following: $1,500 today, $5,000 in 12 years, or $28,000 in 29 years. Assuming that you can earn 6 percent on your money, which should you choose? If you are offered $5,000 in 12 years and you can earn 6 percent on your Money, what is the present value of $5,000?(Round to the nearest cent.) 1:36 GM

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Derek has the opportunity to buy a money machine today. The money machine will pay Derek $35,200.00 exactly 11.00 years from today. Assuming that Derek believes the appropriate discount rate is 7.00%, how much is he willing to pay for this money machine? Submit Answer format: Currency: Round to: 2 decimal places.
Tom just won a lottery. he plans to create a money market certificate in a bank to prepare a down payment for a house $400,000. The down payment is 20% of the house price, and the current five-year APY is 3.25%. How much should you put in the money market certificate account to accumulate the down payment? Group of answer choices $340,886.41 $93,872.91 $469,334.56 $68,117.28
You are offered the right to receive $1,000 per year forever, starting in one year. If your discount rate is 6%, what is this offer worth to you? This offer is worth $ View an example (Round to the nearest dollar.) Get more help - O search D m/Player/Player.aspx?cultureld=&theme-finance&style=highered&disableStandbyIndicator=true&assignmentHandlesLocale=true 4- A www. Clear all 16
Congratulations!! On a trip to Florida, you have just won the US MegaLottery! Lottery officials offer you the choice of 2 alternative payouts: either $1 million today, or $2 million 6 years from now. Which payout will you choose if the relevant discount rate is 0%? 10%? 20%? Ignore taxes.
Assume that you have just won the lottery. Lotto officials offered you the choice of two alternative payouts: ₱10,000,000 today; or ₱30,000,000 seven years from now. As a wise and financial literate individual, which payment will you choose if relevant interest rate is 10%? Explain your choice in not more than ten (10) sentences and support it with your computation.
RESOLVE THIS PROBLEM IN DIGITAL FORMAT (NOT HANDWRITTEN) Solve the following problem step by step, include the formulas you use and the development please Maru wants to buy a house in two years. Suppose that the down payment that you would have to pay at those dates is $ 350,000. If you want to have this amount in two years, what amount should you deposit today at a fixed income of 4.5% semiannual?
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Congratulations! You have just won a small lottery. Lottery officials give you three alternatives for receiving your winnings: a)$8000 now b)$1000 per year for 12 years c)$15000 in 10 years If you can earn 6.5% on your money, which alternative should you choose?
Hi. How would I go about solving a problem like the two I have submitted? Kathleen just received a bonus from EG. She is excited because her dad started his career with EG. If her bonus of $300,000 is equivalent to the bonus paid to her dad 10 years ago, how much was her dad’s bonus? Assume that the average annual inflation rate was 3.8%. (Do not round intermediate calculations. Round your answer to the nearest whole dollar amount.)
You have entered into an agreement for the purchase of land. The agreement specifies that you will take ownership of the land immediately. You have agreed to pay $50,000 today and another $50,000 in three years. Calculate the total cost of the land today, assuming a discount rate of (a) 5%, (b) 7 %, or (c) 9%. Note: Use tables, Excel, or a financial calculator. Round your answers to 2 decimal places. (FV of $1, PV of $1, FVA of $1, and PVA of $1) a. b. C. Payment Amount $ 50,000 50,000 50,000 Interest Rate 7 5% 7% 9% Answer is complete but not entirely correct. Compounding Annually Annually Annually Period Due 3 years 3 years 3 years $ Total Cost of Land Today 93,121.25 X 90,816.30✔ 88,617.30
“Want to win half a million dollars? Here’s how. . . . One winner, chosen at random from allentries, will win a $500,000 annuity.” That was the statement announcing a contest on the WorldWide Web. The contest rules described the “half a million-dollar prize” in greater detail: “20annual payments of $25,000 each, which will result in a total payment of $500,000. The firstpayment will be made January 1; subsequent payments will be made each January thereafter.” Using a compound annual interest rate of 8 percent, what is the present value of this “half amillion-dollar prize” as of the first installment on January 1?
Three friends are offered the choice of $700 today or $10003 years from today. What interest rate would make the two choices equivalent? (Note: the answer is in % scale, i.e. if it is 3.12%, then type in 3.12 ) Answer:

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